TaxTMI 
TaxTMI 
1991 (3) TMI 26
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....the Income-tax Act, 1961, restricts such allowance to the amount payable under the Payment of Bonus Act, 1965 ? " The relevant assessment year is 1977-78. The previous year ending is on December 31, 1976. In May, 1977, at a meeting of the directors of the assessee-company, it was resolved to make certain payments to the workmen by way of bonus. This was found to be in excess of the amount payable under, section 31A of the Payment of Bonus Act, 1965, and, therefore, this excess amount was disallowed when it was claimed as deduction by the assessee. The Appellate Tribunal found that there was a continuous dialogue between the management and the labour union which resulted in resolution for the payment of additional bonus. Therefore, it was ....
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.... second proviso quoted above came into effect only from September 3, 1977, and, therefore, the bar stated in the said proviso was not applicable. Learned counsel for the Revenue pointed out that this is an error committed by the Appellate Tribunal which has affected the conclusion of the Tribunal. It is true that section 31A was amended and certain changes were effected by the insertion of a proviso. However, the present second proviso was already there in the original section as the sole proviso. The alteration that was done by the amendment to the second proviso was by introducing a new proviso as the first proviso as it now stands and the original proviso was transferred as the present second proviso. Therefore, the Appellate Tribunal sh....